With COVID-19 in decline across much of the country, consumer optimism is building. But while a new normal comes into view, customers are balancing re-entry into public life and a return to old habits against the ongoing pandemic risk. This transition has opened a critical window for business leaders: a rare chance to build trust and reset consumers’ views of their brands.
In the tailwinds of the pandemic, the embrace of corporate social responsibility has accelerated, along with the rise of stakeholder capitalism, the idea that companies serve the interests of all stakeholders—including, for example, customers, employees and the community—rather than just shareholders. You can see it in the “open book” policies of companies publicly sharing sustainability data. And you can hear it in BlackRock CEO Larry Fink’s recent promise to “be loud again” about his company’s advocacy-focused investing priorities.
Suffice to say, the crises of the last year—not just the pandemic, but also the burgeoning social justice movement and tumultuous national politics—have intensified consumer scrutiny of the corporations they work for and buy from. And the risks have never been higher, however, with nearly two-thirds of respondents (63%) in new research from The Harris Poll stating that a brand that loses its trust cannot earn it back. But while a sense of urgency is key for brands in this moment, so too is thoughtful planning and action.
After all, corporate reputation can change quickly—for better or for worse. No industry exemplifies this better than the pharmaceutical industry, whose meteoric rise in the hearts and minds of consumers took a dramatic turn over the course of the pandemic. Pre-COVID, the industry’s reputation score languished at 32%, according to Harris polling from January 2020, and then nearly doubled during the pandemic, reaching 62% in February 2021 as widespread vaccine rollout became a reality. The lesson here is that brands don’t need to be loud, political or provocative to build up goodwill and trust—they need to listen, innovate and deliver on their promises.
Understand expectations—and respond wisely
A strong majority of Americans (60%) said in April that well-known brands taking stands on social issues is more important than in the past. Gen Zers and millennials overwhelmingly share this stance (70% each). Why do consumers feel this way? A majority (53%) say that companies have “more platforms and tools at their disposal to speak to and influence a large number of people.”
This is the information age in action: Every major brand has multiple social media accounts and numerous followers. They regularly reach and interact with consumers in ways unimaginable just decades ago. Of course, with great power comes great responsibility.
Companies must actively listen to their customers and choose their response wisely. The pandemic made online engagement more important as in-person contact subsided, and consumers will continue to follow brands’ online moves closely. Instead of simply jumping on the issue of the day, use these channels to take a temperature check engage with customers directly. At the end of the day, brands can’t be expected to join every conversation—nor should they. But they are expected to be responsive and accountable to their customers online.
Put customers first (no, really)
Whether you’re launching a new product or advocating for a specific cause, it’s easy to get caught up in the excitement and lose sight of the customer. Fulfilling public expectations and locking in consumer trust needn’t always involve a bold stance. As often, it simply requires doing the right thing for the community. Think of the myriad ways companies adjusted to keep people safe over the last year, from ensuring that customers and employees wear masks and socially distance to moving the locus of business out of physical stores to minimize potential COVID-19 exposure.
The pharmaceutical industry’s skyrocketing approval is the obvious example of a sector improving its reputation by rising to the occasion, but others abound. Grocery stores, for example, scored the highest marks when we asked consumers which industries have done the best job digitally adapting their products and services. More than three-quarters of respondents (77%) rated the industry positively, with health care doing equally well. No surprise: Surges in online grocery shopping and telemedicine have been two of the most notable innovations of pandemic life. The post-pandemic lesson for other brands: Don’t wait for the next crisis to find innovative ways to make customers’ lives simpler. Make it part of your culture.
If you choose to take a stand, follow through, because talk is cheap
For brands that choose to take a more active role in public advocacy, simply speaking up is not enough: Consumers are looking for action when companies take a stand publicly. More than three-quarters (76%) said that they expect companies to follow through on the stances they take, a majority that was reflected across virtually all demographic groups. When we asked consumers how brands should back up their words, the top response (50%) was that they should donate money to causes they profess to support, followed closely by internal changes, such as to hiring practices, product lines or operating structure (47%). Discussing the issue on social media was easily the least-preferred method (just 32% support). So, if a company talks about reducing its carbon footprint, for example, or protecting consumer privacy, it needs to back those pledges with resources and actions.
And consumers are ready to act themselves. Large majorities said that a brand taking a stand with which they agreed made them more likely to go out of their way to buy from it (72%), recommend it (65%) and tell people that they like the stance (64%). The connective tissue is trust: If consumers see companies striking poses but not acting on them, it will disappear, perhaps permanently.
We’re at a turning point in the pandemic, where expectations, needs and desires are evolving rapidly. Just as the onset of the pandemic saw unprecedented volatility in consumer perception of brands, the reopening is yet another critical inflection point. Smart CEOs should be taking steps now to build, maintain or augment consumer trust for the long haul.